COMMISSIONER OF INCOME TAX vs. RAMESH NAGPAL
What did the High Court hold?
The High Court dismissed the appeal filed by the Revenue. The Court noted that a connected appeal, Income Tax Appeal No. 382 of 2004, for the assessment year 1995-1996, arising from an order of the ITAT dated 28.05.2004, had been decided against the Revenue by a Division Bench of the High Court on 14.03.2005. In light of this prior decision on a connected matter, the High Court found no reason to deviate and consequently dismissed the present appeal. The specific reasoning of the ITAT or CIT(A) regarding the deletion of additions is not detailed in the High Court's order, as the dismissal was based on the precedent of the connected appeal. The operative direction was the dismissal of the appeal.
What were the facts?
The Commissioner of Income Tax, Faridabad (Revenue) filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated 30.12.2005 passed by the Income Tax Appellate Tribunal (ITAT), Delhi Bench. The ITAT had dismissed the Revenue's appeal against an order of the Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A) had deleted an addition of Rs. 2,76,575 made by the Assessing Officer (AO) on account of income from undisclosed sources, which the assessee, Shri Ramesh Nagpal, had claimed as long-term capital gain. The CIT(A) also deleted an addition of Rs. 13,828 related to expenses incurred by the assessee in procuring a bogus long-term capital gain entry. The assessment year in question is 1996-1997. The High Court noted that a connected appeal for assessment year 1995-1996 had been decided against the Revenue.
What were the issues?
1. Whether the Hon'ble ITAT was right in law in dismissing the appeal of the Revenue against the order of the CIT(A) in deleting the addition of Rs. 2,76,575/- made by the Assessing Officer on account of Income from undisclosed sources, which had been claimed by the assessee as long term capital gain? (Question of law, turning on the treatment of income claimed as LTCG). 2. Whether the Hon'ble ITAT was right in law in dismissing the appeal of the Revenue against the order of the CIT(A) in deleting the addition of Rs. 13,828/- in respect of expenses incurred by the assessee in procuring the bogus long term capital gain entry? (Question of law, turning on the allowability of expenses related to bogus LTCG). Assessee's Contentions: The judgment does not record any specific contentions made by the assessee before the High Court. Revenue's Contentions: The Revenue argued that the ITAT was not right in dismissing its appeal against the CIT(A)'s order, which had deleted the additions made by the AO concerning income claimed as long-term capital gain and related expenses.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
JUDGMENT M.M.KUMAR, J.(ORAL) The revenue has approached this Court by filing appeal under Section 260(A) of the Income Tax Act, 1961, challenging the order dated 30.12.2005 passed by the Income Tax Appellate Tribunal, Delhi Bench: SMC: New Delhi (for short 'the Tribunal') in ITA No.961/DEL/2005 for the assessment year 1996-1997 and claimed that the following substantial question of law would arise for our adjudication:- “ Whether the Hon'ble ITAT on the facts and circumstances of the case, was right in law in dismissing the appeal of the Revenue against the order of the CIT(A) in deleting the addition of Rs.2,76,575/- made by the Assessing Officer on account of Income from undisclosed sources, which had been claimed by the assessee as long term capital gain and Rs.13,828/- in respect of expenses incurred by the assessee in procuring the bogus long term capital gain entry.”
Income Tax Appeal No.546 of 2006 [2] When the matter came up for consideration on 19.02.2007, we had deferred the hearing to enable the learned counsel for the revenue to find out whether or not any other appeal connected with the instant appeal is pending. At the time of hearing, learned counsel has stated that connected Income Tax Appeal No. 382 of 2004 arising out of order dated 28.05.2004 passed by Income Tax Appellate Tribunal in ITA No.881/Del./2004 and C.O.No.91/Del./2004 for the assessment year 1995- 1996 has been decided against the revenue on 14.03.2005 by a Division Bench of this Court. A reference of ITA No.881/Del./2004, dated 28.05.2004 for the assessment year 1995-1996 has been made by the Tribunal in para 5 of the order. In view of above statement of learned counsel for the revenue, this appeal fails and the same is dismissed.
( M.M.KUMAR) JUDGE May 8, 2007 (RAJESH BINDAL) nt JUDGE
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